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PRIORITIES - paying your way

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  • Todd Litman
    Horizontal equity (i.e., concern for disadvantaged people) is often raised as an objection to road pricing, higher fuel taxes and other vehicle user fees, but
    Message 1 of 7 , May 16 12:06 PM
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      Horizontal equity (i.e., concern for disadvantaged people) is often raised
      as an objection to road pricing, higher fuel taxes and other vehicle user
      fees, but its a false argument, since lower income people tend to drive
      less than higher income people, particularly on congested urban highways,
      so higher income people capture the vast majority of benefits. Vertical
      equity should be concerned primarily with how revenues are used: if they
      are used to provide services used by lower income people (such as transit
      improvements) or to offset other equally regressive taxes, they can be
      progressive overall, even if the fee is directly regressive.

      Improving transit services on busy corridors benefits both the people who
      use transit, and motorists, who experience less congestion. The better the
      transit service, the lower the toll needed to reduce automobile travel
      demand to optimal volumes.

      Legitimate vertical equity concerns can easily be addressed by insuring
      good travel options and providing targeted discounts and exemptions for
      disadvantaged groups. For example, each resident could receive a limited
      number of free road use credits each year that they can use for essential
      trips or sell to others.

      For more discussion see my paper "Using Road Pricing Revenue: Economic
      Efficiency and Equity Considerations" (http://www.vtpi.org/revenue.pdf) and
      other analyses of road pricing requity.


      Best wishes,
      -Todd Litman


      At 03:05 PM 5/16/2005 +0100, Wetzel Dave wrote:
      >Erel,
      >The effect on poor travellers was a major consideration before we
      introduced
      >the congestion charge in London.
      >
      >With the exception of a few examples (high-lighted in the press) - most
      >"poor" travellers in London were walking, cycling or using buses.
      >
      >The Mayor has helped all families by providing free bus travel to children
      >up to the age of 11 years (16 from September this year).
      >The congestion charge is one of over 30 new policies that the Mayor has
      >introduced to improve bus travel.
      >Hence, "poor" travellers (and increasingly city suites) now enjoy a more
      >reliable bus service with much-improved information, shorter journey times,
      >improved frequencies, extended operating hours and they travel on newer
      more
      >accessible buses.
      >
      >We have achieved a 4% modal shift from car and bus trips are up 40% since
      >the Mayor was elected 5 years ago!
      >
      >Dave
      >Dave Wetzel; Vice-Chair; Transport for London.
      >
      >
      >-----Original Message-----
      >From: Erel.Avineri@... [mailto:Erel.Avineri@...]
      >Sent: 13 May 2005 15:24
      >To: NewMobilityCafe@yahoogroups.com
      >Cc: Erel.Avineri@...
      >Subject: [NewMobilityCafe] PRIORITIES - paying your way
      >
      >
      >
      >Road pricing has its disadvantages as well, and may not be applied
      >everywhere. For example, one of the issues that should not be neglected
      >is to base policy of road pricing on equity grounds. Travellers with low
      >income may not be able to afford the same travel lifestyles that are
      >afforded by the rich, and this may lead (as it already had many times
      >before) to social exclusion.
      >
      >Dr Erel Avineri
      >Lecturer in Integrated Transport
      >Centre for Transport & Society
      >Faculty of the Built Environment
      >University of the West of England
      >Frenchay Campus
    • Wetzel Dave
      Eric Thanks for this posting. It is true that the Underground railway services continue to suffer disruptions from the old equipment not replaced because of
      Message 2 of 7 , May 17 7:42 AM
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        Eric
        Thanks for this posting.

        It is true that the Underground railway services continue to suffer
        disruptions from the old equipment not replaced because of the lack of
        adequate investment since WW2.

        In addition, now that the current Labour Government are providing £2bn pa
        investment in new and refurbished infrastructure, extra delays and
        inconvenience occur as the system is renewed. (eg weekend closures for
        engineering work; some stations are being closed completely for several
        months whilst refurbishment takes place; some platforms are taken out of use
        and passengers have to alight at the next station and return on the opposite
        side; some morning services are delayed because of late access for the
        trains when the PPP engineers over-run their overnight track-laying etc).

        However, despite the problems above, and increased fare levels, the
        Underground has improved its performance and is enjoying unprecedented
        passenger growth. (Last years figures show Underground use at its highest
        level ever - 6m more than our previous best in 2001 - see press release
        below).

        Underground tends to cater for different types of journeys than buses.
        (Longer Underground trips and many bus routes act as feeders to the
        Underground and National Rail stations).

        Given these facts, it is actually unlikely that there has been much transfer
        from Underground to bus.

        Dave
        Dave Wetzel; Vice-Chair; Transport for London.
      • Stefan Langeveld
        Erel Avineri raised an important point. Road pricing etc. pushes lower incomes off the roads, to make way for higher incomes. As Valerie Grove wrote in The
        Message 3 of 7 , May 19 2:27 PM
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          Erel Avineri raised an important point.
          Road pricing etc. pushes lower incomes off the roads, to make way for
          higher incomes. As Valerie Grove wrote in The Times: <And I will love
          it even more if it continues to make motoring easier than before.>

          There are a few ways to block or restrict car use.
          Most popular nowadays is [1] the ability to pay (and willingness,
          which is related to ability). This mechanism applies to 95% of goods
          and services, but that does not make it equitable. Avoid this if
          possible.
          I'm not convinced by "lower income people tend to drive less than
          higher income people ()" or " () most "poor" travellers in London
          were
          walking, cycling or using buses." This resembles a segregation in
          travel modes, based on income, which should not be chosen. Car use
          should not be a priviledge. Mass transit will never be a merit good.

          "If they (the charges) are used to provide services used by lower
          income people (such as transit improvements) or to offset other
          equally regressive taxes, they can be progressive overall, even if
          the
          fee is directly regressive." Beware of these: the product, levy or
          measure may be slightly wrong, but the money goes to charity!

          Another [2] is first come first served. This is how parking permits
          for residents and businesses are/were issued in many cities. Every
          household with a car can get one, no questions asked. Waiting lists
          are inevitable; about four years in Amsterdam City. An entrepeneur
          who
          needs car use can't get a license (and 'can' pay hundreds of euros
          per
          month for on street parking), while her neighbour has a permit, and
          uses his car once a month.

          The best way to reduce trafic (parked and driving)is to optimize it,
          by sharing cars, parking space and rides. Try this first; i think it
          will work wonders.
          To regulate, charge or restrict car use is second best. If you want
          to
          do that, use criteria such as necessity (business, disability),
          shared
          use and environmental impact, to allow certain vehicles into city
          centres.

          Stefan Langeveld

          http://si.a2000.nl:8055/index.php?id=51 charging-page (dutch)


          --- In NewMobilityCafe@yahoogroups.com, Todd Litman wrote:
          > Horizontal equity (i.e., concern for disadvantaged people) is often
          raised
          > as an objection to road pricing, higher fuel taxes and other
          vehicle user
          > fees, but its a false argument, since lower income people tend to
          drive
          > less than higher income people, particularly on congested urban
          highways,
          > so higher income people capture the vast majority of benefits.
          Vertical
          > equity should be concerned primarily with how revenues are used: if
          they
          > are used to provide services used by lower income people (such as
          transit
          > improvements) or to offset other equally regressive taxes, they can
          be
          > progressive overall, even if the fee is directly regressive.
          >
          > Improving transit services on busy corridors benefits both the
          people who
          > use transit, and motorists, who experience less congestion. The
          better the
          > transit service, the lower the toll needed to reduce automobile
          travel
          > demand to optimal volumes.
          >
          > Legitimate vertical equity concerns can easily be addressed by
          insuring
          > good travel options and providing targeted discounts and exemptions
          for
          > disadvantaged groups. For example, each resident could receive a
          limited
          > number of free road use credits each year that they can use for
          essential
          > trips or sell to others.
          >
          > For more discussion see my paper "Using Road Pricing Revenue:
          Economic
          > Efficiency and Equity Considerations" (http://www.vtpi.org/revenue.
          pdf) and
          > other analyses of road pricing requity.
          >
          >
          > Best wishes,
          > -Todd Litman
          >
          >
          > At 03:05 PM 5/16/2005 +0100, Wetzel Dave wrote:
          > >Erel,
          > >The effect on poor travellers was a major consideration before we
          > introduced
          > >the congestion charge in London.
          > >
          > >With the exception of a few examples (high-lighted in the press) -
          most
          > >"poor" travellers in London were walking, cycling or using buses.
          > >
          > >The Mayor has helped all families by providing free bus travel to
          children
          > >up to the age of 11 years (16 from September this year).
          > >The congestion charge is one of over 30 new policies that the
          Mayor
          has
          > >introduced to improve bus travel.
          > >Hence, "poor" travellers (and increasingly city suites) now enjoy
          a
          more
          > >reliable bus service with much-improved information, shorter
          journey times,
          > >improved frequencies, extended operating hours and they travel on
          newer
          > more
          > >accessible buses.
          > >
          > >We have achieved a 4% modal shift from car and bus trips are up
          40%
          since
          > >the Mayor was elected 5 years ago!
          > >
          > >Dave
          > >Dave Wetzel; Vice-Chair; Transport for London.
          > >
          > >
          > >-----Original Message-----
          > >From: Erel.Avineri@u... [mailto:Erel.Avineri@u...]
          > >Sent: 13 May 2005 15:24
          > >To: NewMobilityCafe@yahoogroups.com
          > >Cc: Erel.Avineri@u...
          > >Subject: [NewMobilityCafe] PRIORITIES - paying your way
          > >
          > >
          > >
          > >Road pricing has its disadvantages as well, and may not be applied
          > >everywhere. For example, one of the issues that should not be
          neglected
          > >is to base policy of road pricing on equity grounds. Travellers
          with low
          > >income may not be able to afford the same travel lifestyles that
          are
          > >afforded by the rich, and this may lead (as it already had many
          times
          > >before) to social exclusion.
          > >
          > >Dr Erel Avineri
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